Alexza Wins U.S. Approval for Inhaled Antipsychotic Drug

Dec. 21 (Bloomberg) -- Alexza Pharmaceuticals Inc., the
company that hired Lazard Ltd. a year ago to explore strategic
options including selling itself, won U.S. approval of its rapid
antipsychotic medicine.

The Food and Drug Administration cleared the inhaled
treatment Adasuve for agitation associated with schizophrenia or
bipolar disorder in adults, the company said today in a
statement. The drug, recommended by European regulators for
approval Dec. 14, will be the Mountain View, California-based
company’s first product on the market.

The FDA rejected Alexza’s request to market Adasuve in May
citing manufacturing deficiencies that the company said at the
time probably involved the device used to deliver the drug.
Adasuve is used with Alexza’s Staccato system that vaporizes the
medicine and allows for rapid drug delivery through deep lung
inhalation.

“We believe that the ability to deliver medications
rapidly and non-invasively will be important for patients and
the professionals who care for them,” Thomas King, the
company’s president and chief executive officer, said in the
statement. “This is a landmark day for Alexza and we are proud
of our accomplishments in developing this unique product.”

Sales Estimate

Adasuve may generate an estimated $207 million in U.S.
sales in 2016, Scott Henry, an analyst at Roth Capital Partners,
said in an e-mail before the approval. The drug failed to win
approval in October 2010 because the FDA was concerned that it
may produce adverse side effects.

The company’s shares declined 6.9 percent to $5.79 at 2:39
p.m. New York time when trading was halted before the drug-approval announcement.

Of the estimated 3.2 million patients treated for
schizophrenia or bipolar disorder in the U.S., about 90 percent
suffer from agitation during their lifetime, Alexza said in its
statement.

The product will include a boxed safety warning about
potential dangerous side effects including the potential for
fatal bronchial spasms in people with asthma or chronic
obstructive pulmonary disorder and a higher risk of death in
elderly people with dementia-related psychosis. Adasuve use will
be restricted to mitigate potential harm of bronchial spasms,
the company said.

Clinical Trial

The FDA also required Alexza to conduct a large post-marketing clinical trial of patients to assess “the real-world
use” of the drug, the company said.

Alexza in February fired 29 employees, or 38 percent of its
workforce, to focus on development of Adasuve and sold 44
million shares, raising about $20.4 million, the company said in
a statement. The company had hired Lazard in December 2011 to
explore whether it should find a buyer.

Zyprexa, from Indianapolis-based Lilly generated $4.6
billion in sales last year, according to data compiled by
Bloomberg, though generic companies were able to begin making
copies of oral versions of the drug in October 2011. New York-based Bristol-Myers’s Abilify brought in $2.8 billion last year
and New York-based Pfizer’s Geodon earned $1 billion.